Under the dual impact of the global economic slowdown and geopolitical tension, OPEC has lowered its expectations for global crude oil demand growth in the next two years.

On Monday, OPEC released its monthly report on crude oil, lowering its forecast for global oil demand growth in 2024 from 2.25 million barrels per day in June to about 2.11 million barrels per day, a decrease of 0.135 million barrels per day. Although the adjustment was not significant, it was the first time since July 2023, when OPEC first released its 2024 forecast, that it has lowered its relatively optimistic expectations.

OPEC wrote in the report:

This slight modification reflects actual data for the first quarter of 2024, and in some cases, for the second quarter, as well as a weakening of expectations for oil demand growth in 2024.

Due to differences in the speed of global energy transformation, OPEC's judgement on the strength of oil demand growth in 2024 is more varied than usual.

OPEC and its allies, including Russia, will decide in the coming weeks whether to continue with production expansion plans originally scheduled to begin in October. At a meeting earlier this month, OPEC+ said it may "pause or reverse" the production increase plan based on market conditions.

In the report, OPEC also lowered its demand growth expectations for next year from the previously expected 1.85 million barrels per day to 1.78 million barrels per day.

Although OPEC has lowered its demand growth expectations, its forecast is still far higher than industry consensus.

OPEC expects oil consumption to grow at a "healthy" rate of 2.11 million barrels per day this year, averaging 10.43 million barrels per day. This forecast is not only higher than pre-pandemic normal growth levels, but also more than twice the forecast of the International Energy Agency (IEA), approaching the upper limit of expectations for major oil companies such as Saudi Aramco.

According to the monthly report, OPEC+ countries' crude oil production in July was 26.746 million barrels per day, slightly higher than June's 26.562 million barrels per day. Specifically,

In July, Russia's crude oil production fell to 9.089 million barrels per day, a decrease of 0.026 million barrels from June, but 0.111 million barrels per day higher than the OPEC+ agreement target;

Saudi Arabia's crude oil production in July was 9.015 million barrels per day, up from 8.918 million barrels per day in June;

Iraq's crude oil production in July was 4.251 million barrels per day, up from 4.194 million barrels per day in June;

According to second-hand information, Iran's crude oil production in July was 3.271 million barrels per day, up from 3.25 million barrels per day in June.

Editor/Lambor